Restrictive bond or debt covenant, Finance Basics

Assignment Help:

Restrictive Bond or Debt Covenant

In this case the debenture holders will impose strict conditions and terms on the borrower. These restrictions may comprise:

a) No disposal of assets with no the authorization of the lender.

b) No payment of bonus from retained earnings

c) Maintenance of a provided level of liquidity indicated through the Amount of current assets in relation to current liabilities.

d) Restrictions on organizations and mergers

e) No using of additional debt, before the current debt is completely serviced or paid.

f) The bondholders may recommend the category of project to be undertaking in relation to the riskiness of the project.


Related Discussions:- Restrictive bond or debt covenant

Objective to transfers of financial assets, Access the relevant authoritati...

Access the relevant authoritative literature on accounting for the transfer of financial assets. What conditions must be met for a transfer of receivables to be accounted for as a

Explain mechanics of security trading in stock exchange, Explain Mechanics ...

Explain Mechanics of security trading in Stock Exchange Introduction: An investor should have some knowledge of how the securities markets operate. Marketing of old or new se

Cash flow statement, how to calculate cash flow? What components are requir...

how to calculate cash flow? What components are required to calculate it ?

Finance Assignment, I have an assignment for my finance class. The company ...

I have an assignment for my finance class. The company that i have FOR industry analysis is COSTCO WHOLESALES CORP THAT ITS STOCK IS IN DISCOUNT AND VARIETY StORES INDUSTRY. I need

Benefits of payback period, Benefits of Payback Period 1. use simply a...

Benefits of Payback Period 1. use simply and understand and it has created it popular among in ascertaining the viability of venture executives, mainly traditional financial m

Disadvantages of floatation of new shares, Disadvantages of Floatation of N...

Disadvantages of Floatation of New Shares 1. The cost of getting a quotation is high, mainly when a new issue of shares is completed and the company is small. It means that su

Question 7.1, Assume the managers of Fort Winston Hospital are setting the ...

Assume the managers of Fort Winston Hospital are setting the price on a new outpatient service. Here are the relevant data estimates. Variable costs $ 5.00 Annual fixed c

Compute appropriate net present value, Imagine Joy is the project coordinat...

Imagine Joy is the project coordinator in a company where four projects are running concurrently. He's employed you as the senior business analyst to perform some financial calcula

Maximum price of uniformed bonds, Say that a buyer of bonds values good bon...

Say that a buyer of bonds values good bonds at $500 and values bad bonds at $250. Sellers of both good and bad bonds value them at $350. If the fraction of good sellers and bad s

What is a treasury bill, What is a Treasury bill? How risky is it? Trea...

What is a Treasury bill? How risky is it? Treasury bills are short-term debt instruments granted by the U.S. Treasury which are sold at a discount and pay face value at maturit

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd